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You call THAT a retention strategy!?

There are no right or wrong retention strategies. Everything depends on so much on company size, industry, budget, location, customer/product base, whether or not the company is in high growth mode or hanging on for survival, etc. Having said that, I can tell that you that there are most definitely wrong ways to execute on retention strategies.

Let me be clear, I am not commenting on any genuine, well-intended attempt that a company puts forth to try and retain its people. It’s a competitive landscape out there and all is fair in talent acquisition and talent management. I applaud companies for trying innovative ways to keep people, especially when it simply isn’t possible to keep doling out chunks of cash year over year.

Businessman in chainsHowever, as an organization and as a (HR) leader, you have to stay true to the intent of the retention strategy. I believe that retention initiatives are first and foremost intended to keep your good people (duh!) but just as important they formulate part of your employment brand. You become known to current and potential candidates for the types of things you do to keep people. When done right, these can serve as great differentiators or enhancers to your brand and when applied the wrong way, they can severely damage it.

Let me give you an example. I recently came across an organization which invests heavily in the professional development of its technical staff. For anything beyond a conference or seminar, they would pay for the employee to take the course (typically post-secondary or certification based) with a 2-3 year payback period. Meaning, if they paid $3000 for you to become certified in something, if you left before the three mark, you would owe back $1000 for every year of service not completed after that. I.e. you take the course, 1 year later you leave; you owe $2000 – pretty straight forward and pretty fair.

Recently, the company started losing a lot of good talent to a competitor for a multitude of reasons. Some were based on pay, some were based on work culture and some were based on leadership. So what did the company do in response to this? Well, first off, they changed their professional development policy. If you left within 3 years you now owed 100% of the money back…no sliding scale! (Way to address the cultural issue you have!) Talk about using a good retention program for evil…or at the very least, with the wrong application!

A more specific example that occurred with this company is when one of their rising stars accepted a role with a competing company. She went to her manager to give him her two weeks’ notice. This employee had been there approx. 7 years and was a solid performer. So, what was the manager’s response when she resigned you ask? First thing he did was check to see if she “owed” the company anything. Sure enough, 3 years ago they had paid a few thousand bucks for her to take a certification. They told her she would owe the full amount back as she was a week short of the three year commitment. What made this truly slimy was that that this course was taken before their most recent policy change! (i.e. she was still on the sliding scale plan.)

So what did this employee do? She changed her notice period to three week’s (because the company she was going to was more than happy to wait one more week for her) and then she didn’t owe them anything. This was an employee who previously didn’t have anything bad to say about her current employer and was leaving on good terms, albeit for a new opportunity she couldn’t get there. However, this completely soured her on her previous company. She felt like her time there didn’t mean anything and that all they cared about was getting the last nickel out of her.

Now, instead of leaving and speaking highly of her time there, and possibly returning in the future, she left angry, upset and would not refer anyone there. Talk about using your retention program for the wrong reasons! The amount of damage done to this company’s brand in a short period of time is immeasurable. Word quickly got around (the industry and skill set this person works in is very niche) about how her previous company used their retention program as a hammer. Now there are even more employees there looking to move on!

The bottom line is this – HR Professionals, you have to be the stewards of your organizations and make sure this type of crap doesn’t happen. If you have retention issues, the answer isn’t to make your retention program(s) punitive and restricting and create an environment of indentured servitude. You need to dig deeper and get to some root cause analysis about why people are leaving your company. For the company referred to in this post, my guess, based on how this employee was treated, was that they may some short sighted leadership. But that’s just a guess. As always, I welcome your comments and feedback.

Photo courtesy of patrisyu/FreeDigitalPhotos.net

 

 

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